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TC PipeLines, LP acquires, owns, and participates in the management of energy infrastructure businesses in North America. The last earnings update was 104 days ago. More info.
7 Day | 30 Day | 90 Day | 1 Year | 3 Year | 5 Year | |
---|---|---|---|---|---|---|
TC PipeLines (TCP) | 3.9% | 9.3% | 9.8% | -30.7% | -23.8% | -26.9% |
US Oil and Gas | 2.4% | 5% | 2.3% | 0% | 21.9% | -23.8% |
US Market | 1.4% | 5.6% | 5.7% | 2.3% | 44.2% | 40.9% |
Is TC PipeLines undervalued based on future cash flows and its price relative to the stock market?
Below are the data sources, inputs and calculation used to determine the intrinsic value for TC PipeLines.
Data Point | Source | Value |
---|---|---|
Valuation Model | 2 Stage Free Cash Flow to Equity | |
Levered Free Cash Flow | Average of 5 Analyst Estimates (S&P Global) | See below |
Discount Rate (Cost of Equity) | See below | 14.4% |
Perpetual Growth Rate | 10-Year US Government Bond Rate | 2.7% |
An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.
Data Point | Calculation/ Source | Result |
---|---|---|
Risk-Free Rate | 10-Year US Govt Bond Rate | 2.7% |
Equity Risk Premium | S&P Global | 7.3% |
Oil and Gas Unlevered Beta | Simply Wall St/ S&P Global | 0.93 |
Re-levered Beta | = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.933 (1 + (1- 21%) (92.09%)) |
1.612 |
Levered Beta | Levered Beta limited to 0.8 to 2.0 (practical range for a stable firm) |
1.61 |
Discount Rate/ Cost of Equity |
= Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.73% + (1.612 * 7.27%) |
14.45% |
Discounted Cash Flow Calculation for NYSE:TCP using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for TC PipeLines is arrived at by discounting future cash flows to their present value using the 2 stage method. We use analyst's estimates of cash flows going forward 5 years for the 1st stage, the 2nd stage assumes the company grows at a stable rate into perpetuity.
2019 | 2020 | 2021 | 2022 | 2023 | |
Levered FCF (USD, Millions) | 285.39 | 308.87 | 334.29 | 361.80 | 391.57 |
Source | Est @ 8.23% | Est @ 8.23% | Est @ 8.23% | Est @ 8.23% | Est @ 8.23% |
Present Value Discounted (@ 14.45%) |
249.36 | 235.81 | 222.99 | 210.87 | 199.41 |
Present value of next 5 years cash flows | $1,118.45 |
Calculation | Result | |
---|---|---|
Terminal Value |
= FCF2023
× (1 + g) ÷ (Discount Rate – g)
= $391.57 × (1 + 2.73%) ÷ (14.45% – 2.73%) |
$3,432.62 |
Present Value of Terminal Value |
= Terminal Value ÷ (1 + r)5
= $3,432.62 ÷ (1 + 14.45%)5 |
$1,748.12 |
Calculation | Result | |
---|---|---|
Total Equity Value |
= Present value of next 5 years cash flows +
Terminal Value
= $1,118.45 + $1,748.12 |
$2,866.57 |
Equity Value per Share (USD) |
= Total value / Shares Outstanding
= $2,866.57 / 71.31 |
$40.2 |
Calculation | Result | |
---|---|---|
Value per share (USD) | From above. | $40.20 |
Current discount | Discount to share price of
$33.98
= -1 x ($33.98 - $40.20) / $40.20 |
15.5% |
Learn more about our DCF calculations in Simply Wall St’s analysis model .
Data Point | Source | Value |
---|---|---|
Earnings Per Share * | Company Filings (2018-09-30) in USD | $3.90 |
NYSE:TCP Share Price ** | NYSE (2019-02-21) in USD | $33.98 |
United States of America Oil and Gas Industry PE Ratio | Median Figure of 91 Publicly-Listed Oil and Gas Companies | 12.61x |
United States of America Market PE Ratio | Median Figure of 3,045 Publicly-Listed Companies | 17.39x |
* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.
** Primary Listing of TC PipeLines.
Calculation | Outcome | |
---|---|---|
PE Ratio | = NYSE:TCP Share Price ÷ EPS (both in USD) = 33.98 ÷ 3.90 |
8.71x |
Learn more about our ratios and growth rates in Simply Wall St’s analysis model >
Data Point | Source | Value |
---|---|---|
PE Ratio | See PE Ratio Section | 8.71x |
Net Income Annual Growth Rate | See Future Growth Section. Line of Best Fit* through Consensus Estimate Earnings of 5 Analysts |
-1.5%per year |
United States of America Oil and Gas Industry PEG Ratio | Median Figure of 64 Publicly-Listed Oil and Gas Companies | 0.53x |
United States of America Market PEG Ratio | Median Figure of 2,118 Publicly-Listed Companies | 1.44x |
*Line of best fit is calculated by linear regression .
Calculation | Outcome | |
---|---|---|
PEG Ratio | = PE Ratio ÷ Net Income Annual Growth Rate = 8.71x ÷ -1.5% |
-5.69x |
Learn more about our ratios and growth rates in Simply Wall St’s analysis model >
Data Point | Source | Value |
---|---|---|
Book Value per Share | Company Filings (2018-09-30) in USD | $14.56 |
NYSE:TCP Share Price * | NYSE (2019-02-21) in USD | $33.98 |
United States of America Oil and Gas Industry PB Ratio | Median Figure of 194 Publicly-Listed Oil and Gas Companies | 1.13x |
United States of America Market PB Ratio | Median Figure of 5,129 Publicly-Listed Companies | 1.87x |
Calculation | Outcome | |
---|---|---|
PB Ratio | = NYSE:TCP Share Price ÷ Book Value per Share (both in USD) = 33.98 ÷ 14.56 |
2.33x |
* Primary Listing of TC PipeLines.
Learn more about our ratios and growth rates in Simply Wall St’s analysis model >
How is TC PipeLines expected to perform in the next 1 to 3 years based on estimates from 5 analysts?
Data Point | Source | Value (per year) |
---|---|---|
NYSE:TCP Future Earnings Growth Rate | Line of Best Fit* through Consensus Estimate Earnings of 5 Analysts | -1.5% |
NYSE:TCP Future Revenue Growth Rate | Line of Best Fit* through Consensus Estimate Revenue of 5 Analysts | -6.4% |
United States of America Oil and Gas Industry Earnings Growth Rate | Market Cap Weighted Average | 10.3% |
United States of America Oil and Gas Industry Revenue Growth Rate | Market Cap Weighted Average | 5.8% |
United States of America Market Earnings Growth Rate | Market Cap Weighted Average | 12.7% |
United States of America Market Revenue Growth Rate | Market Cap Weighted Average | 7.1% |
*Line of best fit is calculated by linear regression .
Industry and Market average data is calculated daily.
Learn more about our growth rate calculations in Simply Wall St’s analysis model.
Data Point | Source | Value |
---|---|---|
Past Financials | Company Filings (4 months ago) | See Below |
Future Estimates | Average of up to 5 Analyst Estimates (S&P Global) | See Below |
Date (Data in USD Millions) | Revenue | Cash Flow | Net Income * | Avg. No. Analysts |
---|---|---|---|---|
2023-12-31 | ||||
2022-12-31 | ||||
2021-12-31 | ||||
2020-12-31 | 544 | 278 | 1 | |
2019-12-31 | 535 | 340 | 249 | 3 |
2018-12-31 | 600 | 457 | 280 | 2 |
Date (Data in USD Millions) | Revenue | Cash Flow | Net Income * |
---|---|---|---|
2018-09-30 | 603 | 419 | 277 |
2018-06-30 | 594 | 394 | 263 |
2018-03-31 | 572 | 386 | 241 |
2017-12-31 | 546 | 376 | 219 |
2017-09-30 | 533 | 396 | 211 |
2017-06-30 | 531 | 387 | 212 |
2017-03-31 | 527 | 424 | 212 |
2016-12-31 | 523 | 417 | 211 |
2016-09-30 | 513 | 422 | 19 |
2016-06-30 | 488 | 403 | 21 |
2016-03-31 | 467 | 332 | 13 |
2015-12-31 | 514 | 260 | -2 |
*GAAP earnings excluding extraordinary items.
Data Point | Source | Value |
---|---|---|
Past Financials | Company Filings (4 months ago) | See Below |
Future Estimates | Average of up to 5 Analyst Estimates (S&P Global) | See Below |
All data from TC PipeLines Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.
Date (Data in USD Millions) | EPS * | EPS High Estimate | EPS Low Estimate | Avg. No. Analysts |
---|---|---|---|---|
2023-12-31 | ||||
2022-12-31 | ||||
2021-12-31 | ||||
2020-12-31 | 3.90 | 4.25 | 3.54 | 2.00 |
2019-12-31 | 3.51 | 4.28 | 2.95 | 5.00 |
2018-12-31 | 4.17 | 4.81 | 3.95 | 5.00 |
Date (Data in USD Millions) | EPS * |
---|---|
2018-09-30 | 3.90 |
2018-06-30 | 3.73 |
2018-03-31 | 3.45 |
2017-12-31 | 3.16 |
2017-09-30 | 3.08 |
2017-06-30 | 3.14 |
2017-03-31 | 3.18 |
2016-12-31 | 3.21 |
2016-09-30 | 0.29 |
2016-06-30 | 0.33 |
2016-03-31 | 0.20 |
2015-12-31 | -0.03 |
*GAAP earnings excluding extraordinary items.
How has TC PipeLines performed over the past 5 years?
All data from TC PipeLines Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.
Date (Data in USD Millions) | Revenue | Net Income * | G+A Expenses | R&D Expenses |
---|---|---|---|---|
2018-09-30 | 603.00 | 277.00 | 6.00 | |
2018-06-30 | 594.00 | 263.00 | 6.00 | |
2018-03-31 | 572.00 | 241.00 | 7.00 | |
2017-12-31 | 546.00 | 219.00 | 8.00 | |
2017-09-30 | 533.00 | 211.00 | 8.00 | |
2017-06-30 | 531.00 | 212.00 | 7.00 | |
2017-03-31 | 527.00 | 212.00 | 7.00 | |
2016-12-31 | 523.00 | 211.00 | 7.00 | |
2016-09-30 | 513.00 | 19.00 | 9.00 | |
2016-06-30 | 488.00 | 21.00 | 9.00 | |
2016-03-31 | 467.00 | 13.00 | 8.00 | |
2015-12-31 | 514.00 | -2.00 | 9.00 | |
2015-09-30 | 427.00 | 189.00 | 6.00 | |
2015-06-30 | 422.00 | 174.00 | 10.00 | |
2015-03-31 | 422.00 | 168.00 | 10.00 | |
2014-12-31 | 424.00 | 168.00 | 9.00 | |
2014-09-30 | 422.00 | 162.00 | 9.00 | |
2014-06-30 | 427.00 | 167.00 | 6.00 | |
2014-03-31 | 424.00 | 154.00 | 9.00 | |
2013-12-31 | 408.00 | 126.00 | 9.00 | |
2013-09-30 | 410.00 | 75.00 | 9.00 | |
2013-06-30 | 418.00 | 87.00 | 8.00 | |
2013-03-31 | 492.00 | 124.00 | 6.00 | |
2012-12-31 | 442.00 | 134.00 | 6.00 | |
2012-09-30 | 388.00 | 182.00 | 6.00 | |
2012-06-30 | 338.00 | 176.00 | 6.00 | |
2012-03-31 | 222.00 | 151.00 | 9.00 |
*GAAP earnings excluding extraordinary items.
How is TC PipeLines's financial health and their level of debt?
All data from TC PipeLines Company Filings, last reported 4 months ago.
Date (Data in USD Millions) | Total Equity | Total Debt | Cash & Short Term Investments |
---|---|---|---|
2018-09-30 | 1,166.00 | 2,247.00 | 48.00 |
2018-06-30 | 1,155.00 | 2,308.00 | 51.00 |
2018-03-31 | 1,124.00 | 2,377.00 | 68.00 |
2017-12-31 | 1,068.00 | 2,403.00 | 33.00 |
2017-09-30 | 1,018.00 | 2,478.00 | 73.00 |
2017-06-30 | 1,015.00 | 2,390.00 | 51.00 |
2017-03-31 | 1,222.00 | 1,809.00 | 60.00 |
2016-12-31 | 1,272.00 | 1,911.00 | 64.00 |
2016-09-30 | 1,101.00 | 1,923.00 | 72.00 |
2016-06-30 | 1,071.00 | 1,953.00 | 40.00 |
2016-03-31 | 1,096.00 | 2,073.00 | 48.00 |
2015-12-31 | 1,151.00 | 1,903.00 | 39.00 |
2015-09-30 | 1,327.00 | 1,904.00 | 28.00 |
2015-06-30 | 1,338.00 | 1,914.00 | 44.00 |
2015-03-31 | 1,589.00 | 2,034.00 | 384.00 |
2014-12-31 | 1,586.00 | 1,695.00 | 26.00 |
2014-09-30 | 1,813.00 | 1,533.00 | 98.00 |
2014-06-30 | 1,768.00 | 1,563.00 | 45.00 |
2014-03-31 | 1,791.00 | 1,568.00 | 41.00 |
2013-12-31 | 1,789.00 | 1,578.00 | 25.00 |
2013-09-30 | 1,829.00 | 1,552.00 | 4.00 |
2013-06-30 | 1,649.00 | 376.00 | 67.00 |
2013-03-31 | 1,287.00 | 685.00 | 2.00 |
2012-12-31 | 2,422.00 | 1,028.00 | 3.00 |
2012-09-30 | 1,313.00 | 692.00 | 7.00 |
2012-06-30 | 1,321.00 | 700.00 | 6.00 |
2012-03-31 | 1,330.00 | 707.00 | 5.00 |
What is TC PipeLines's current dividend yield, its reliability and sustainability?
Data Point | Source | Value |
---|---|---|
Past Annualized Dividend Yield | S&P Global Market Data | See Below |
Past Dividends per Share | Company Filings/ Annualized Dividend Payments | See Below |
Future Dividends per Share Estimates | Average of up to 5 Analyst Estimates (S&P Global) | See Below |
United States of America Oil and Gas Industry Average Dividend Yield | Market Cap Weighted Average of 61 Stocks | 3.5% |
United States of America Market Average Dividend Yield | Market Cap Weighted Average of 2001 Stocks | 2.5% |
United States of America Minimum Threshold Dividend Yield | 10th Percentile | 0.8% |
United States of America Bottom 25% Dividend Yield | 25th Percentile | 1.4% |
United States of America Top 25% Dividend Yield | 75th Percentile | 3.5% |
Industry and Market average data is calculated daily.
Note all dividend per share amounts are annualized and not quarterly or other period.
Date (Data in $) | Dividend per Share (annual) | Avg. No. Analysts |
---|---|---|
2023-12-31 | 2.85 | 2.00 |
2022-12-31 | 2.82 | 2.00 |
2021-12-31 | 2.74 | 3.00 |
2020-12-31 | 2.70 | 8.00 |
2019-12-31 | 2.65 | 9.00 |
2018-12-31 | 2.72 | 9.00 |
Date (Data in $) | Dividend per share (annual) | Avg. Yield (%) |
---|---|---|
2019-01-22 | 2.600 | 8.126 |
2018-10-23 | 2.600 | 8.422 |
2018-07-26 | 2.600 | 8.104 |
2018-05-02 | 2.600 | 9.996 |
2018-01-23 | 4.000 | 9.776 |
2017-10-24 | 4.000 | 7.579 |
2017-08-03 | 4.000 | 7.636 |
2017-08-02 | 4.000 | 7.111 |
2017-04-25 | 3.760 | 6.637 |
2017-01-23 | 3.760 | 6.227 |
2016-11-04 | 3.760 | 6.938 |
2016-08-04 | 3.760 | 6.944 |
2016-05-04 | 3.560 | 6.476 |
2016-02-26 | 3.560 | 7.028 |
2016-02-25 | 3.560 | 8.150 |
2015-11-06 | 3.560 | 7.920 |
2015-07-24 | 3.560 | 6.766 |
2015-04-23 | 3.360 | 5.440 |
2015-02-25 | 3.360 | 5.299 |
2014-10-24 | 3.360 | 4.892 |
2014-07-24 | 3.360 | 5.718 |
2014-04-28 | 3.240 | 6.287 |
2014-01-17 | 3.240 | 6.785 |
2013-10-25 | 3.240 | 6.850 |
2013-07-24 | 3.240 | 6.578 |
2013-04-24 | 3.120 | 6.730 |
2013-02-28 | 3.120 | 6.491 |
2013-02-08 | 3.120 | 6.885 |
2012-10-26 | 3.120 | 7.494 |
2012-07-25 | 3.120 | 6.793 |
2012-04-24 | 3.080 | 7.326 |
2012-01-17 | 3.080 | 6.751 |
2011-10-20 | 3.080 | 6.577 |
2011-07-19 | 3.080 | 6.971 |
2011-04-19 | 3.000 | 6.387 |
2011-01-18 | 3.000 | 5.751 |
2010-10-20 | 3.000 | 6.140 |
2010-07-20 | 2.920 | 6.607 |
2010-04-20 | 2.920 | 7.526 |
2010-01-20 | 2.920 | 7.814 |
2009-10-22 | 2.920 | 7.787 |
2009-07-30 | 2.920 | 7.775 |
2009-04-17 | 2.820 | 8.351 |
2009-02-23 | 2.820 | 10.137 |
Learn more about our ratios and growth rates in Simply Wall St’s analysis model >
Average tenure and age of the TC PipeLines management team in years:
Average tenure and age of the TC PipeLines board of directors in years:
This analysis is intended to introduce important early concepts to people who are starting to invest. … While TCP might seem like an attractive stock to buy, it is important to understand the assumptions behind the P/E ratio before you make any investment decisions. … I will deconstruct the P/E ratio and highlight what you need to be careful of when using the P/E ratio
Simply Wall St - – Full articleThe content of this article will benefit those of you who are starting to educate yourself about investing in the stock market. … If TCP borrows debt to invest in its business, its profits will be higher. … But ROE does not capture any debt, so we only see high profits and low equity, which is great on the surface
Simply Wall St - – Full articleTC PipeLines LP (NYSE:TCP) is a stock with outstanding fundamental characteristics. … When we build an investment case, we need to look at the stock with a holistic perspective. … In the case of TCP, it
Simply Wall St - – Full articleReturn on Equity = Net Profit ÷ Shareholders Equity ROE is measured against cost of equity in order to determine the efficiency of TC PipeLines’s equity capital deployed. … ROE can be dissected into three distinct ratios: net profit margin, asset turnover, and financial leverage. … This is called the Dupont Formula: Dupont Formula ROE = profit margin × asset turnover × financial leverage ROE = (annual net profit ÷ sales) × (sales ÷ assets) × (assets ÷ shareholders’ equity) ROE = annual net profit ÷ shareholders’ equity NYSE:TCP Last Perf Jun 1st 18 Essentially, profit margin shows how much money the company makes after paying for all its expenses.
Simply Wall St - – Full articleAdditionally, TCP has generated US$376.00M in operating cash flow in the last twelve months, leading to an operating cash to total debt ratio of 15.65%, signalling that TCP’s operating cash is not sufficient to cover its debt. … We can check to see whether TCP is able to meet its debt obligations by looking at the net interest coverage ratio. … In TCP's, case, the ratio of 4.17x suggests that interest is appropriately covered, which means that lenders may be inclined to lend more money to the company, as it is seen as safe in terms of payback.Next Steps: TCP’s high debt levels is not met with high cash flow coverage.
Simply Wall St - – Full articleA consensus of 6 US oil, gas and consumable fuels analysts covering the stock indicates that its revenue level is expected to decline by -5.44% by 2020, putting pressure on expected future earnings, with its year-on-year growth rate estimated to underperform the industry average growth (1.61% vs. … When revenues are declining and earnings growth are lagging the industry, there is high uncertainty around the sustainability of its current operations. … With 71.31 million shares, that's a US$1.84B market cap - which is too low for a company that has a 5-year free cash flow cumulative average growth rate (CAGR) of 7.46% (source: analyst consensus).
Simply Wall St - – Full articleTC PipeLines is available at a price-to-earnings ratio of 11.23x, showing us it is undervalued relative to the current US market average of 18.27x , and undervalued based on its latest annual earnings update compared to the oil and gas average of 13.31x. … However, since TC PipeLines is a high-growth stock, we must also account for its earnings growth by using calculation called the PEG ratio. … A PE ratio of 11.23x and expected year-on-year earnings growth of 10.24% give TC PipeLines an acceptable PEG ratio of 1.1x.
Simply Wall St - – Full articleTC PipeLines LP (NYSE:TCP) trades with a trailing P/E of 9.7x, which is lower than the industry average of 12.5x. … Formula Price-Earnings Ratio = Price per share ÷ Earnings per share P/E Calculation for TCP Price per share = $30.81 Earnings per share = $3.165 ∴ Price-Earnings Ratio = $30.81 ÷ $3.165 = 9.7x The P/E ratio itself doesn’t tell you a lot; however, it becomes very insightful when you compare it with other similar companies. … Since TCP's P/E of 9.7x is lower than its industry peers (12.5x), it means that investors are paying less than they should for each dollar of TCP's earnings.
Simply Wall St - – Full articleBelow is my commentary, albeit very simple and high-level, on how market analysts predict TC PipeLines's earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. … The growth outlook in the following year seems much more buoyant with rates reaching double digit 17.60% compared to today’s earnings, and finally hitting US$311.85M by 2021. … NYSE:TCP Future Profit Mar 30th 18 Even though it’s useful to be aware of the rate of growth year by year relative to today’s value, it may be more valuable to gauge the rate at which the earnings are rising or falling on average every year.
Simply Wall St - – Full articleBelow, I will run you through a simple sense check to build perspective on how TC PipeLines is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its oil and gas industry peers. … Check out our latest analysis for TC PipeLines How TCP fared against its long-term earnings performance and its industry I prefer to use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. … This means that, in the recent industry expansion, TC PipeLines has not been able to realize the gains unlike its industry peers.What does this mean?
Simply Wall St - – Full article
TC PipeLines, LP acquires, owns, and participates in the management of energy infrastructure businesses in North America. The company has interests in eight natural gas interstate pipeline systems that transport approximately 10.4 billion cubic feet per day of natural gas from producing regions and import facilities to market hubs and consuming markets primarily in the Western, Midwestern, and Eastern United States. It serves large utilities, local distribution companies, natural gas marketers, producing companies, and other interstate pipelines, including affiliates. TC PipeLines GP, Inc. operates as a general partner of the company. TC PipeLines, LP was founded in 1998 and is based in Houston, Texas.
Name: | TC PipeLines, LP |
TCP | |
Exchange: | NYSE |
Founded: | 1998 |
$2,440,104,871 | |
71,306,396 | |
Website: | http://www.tcpipelineslp.com |
Address: |
TC PipeLines, LP 700 Louisiana Street, Suite 700, Houston, Texas, 77002, United States |
Exchange Symbol | Ticker Symbol | Security | Exchange | Country | Currency | Listed on | |
---|---|---|---|---|---|---|---|
NYSE | TCP | Common Units | New York Stock Exchange | US | USD | 25. May 1999 | |
DB | TC0 | Common Units | Deutsche Boerse AG | DE | EUR | 25. May 1999 |
Oil and Gas Storage and Transportation | |
Energy |
Area | Date (UTC time) |
---|---|
Company Analysis updated: | 2019/02/21 23:47 |
End of day share price update: | 2019/02/21 00:00 |
Last estimates confirmation: | 2019/02/21 |
Last earnings filing: | 2018/11/09 |
Last earnings reported: | 2018/09/30 |
Last annual earnings reported: | 2017/12/31 |
All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.